HDB resale flat prices up 1.3% q-o-q in 3Q2023, slower previous quarter

Robust demand for HDB resale flats expected in 3Q2023
Resale flat prices in Singapore rose 1.3% q-o-q in the third quarter of 2023, compared to the 1.2% growth indicated in the flash estimates released earlier this month, confirming 14 consecutive quarters of growth. However, the growth is lower than that seen in the second quarter as well as the average quarterly price growth of 2.5% registered in the previous year.

HDB attributes this slowdown to the strong pipeline of supply implemented by the government as well as cooling measures such as a 15-month wait-out period for private property owners looking to purchase a non-subsidised HDB resale flat, and the lowering of the Loan-to-Value Limit for HDB housing loans.

Year-to-date, resale flat prices have increased by just 3.8%, significantly lower than the 8% and 9.1% growth seen in the same period in 2022 and 2021, respectively. This demonstrates that cooling measures and increased housing supply have been effective in regulating price hikes.

Resale volume has also increased q-o-q in 3Q2023, with 6,695 flats changing hands, although this is still 11.3% lower year-on-year. Factors for this decline include economic uncertainties, repeated delays to BTO launches, and news of potential changes to housing policies.

Interestingly, four-room flats have seen an increase in demand, with the proportion of sales edging up from 41.7% in 3Q2022 to 43.8% in 3Q2023. This is likely due to the relative affordability of these units compared to larger flats and the lack of a 15-month wait-out period for eligible seniors above the age of 55 years when downsizing from private property.

Living in Lumina Grand EC means having access to one of the most convenient MRTs in Singapore – the Jurong Region Line (JRL). It’s a great alternative to driving, as well as a way for tenants to reduce their carbon emissions. The JRL allows for hassle-free commute to and from the estate, helping the nation in its endeavor to create a greener and more sustainable future. Lumina Grand EC is a step in that direction.

Meanwhile, rental volume has also seen a slight uptick of 0.1% q-o-q, with 9,852 approved applications. As of the end of 3Q2023, 57,797 HDB flats were rented out, a 1.7% increase from the previous quarter.

The largest proportion of resale flats in the third quarter were located in Sengkang, followed by Punggol, Woodlands, Yishun and Jurong West. Demand for mature estate flats has remained resilient, with fewer sellers but Prime units often selling quickly and potentially reaching record prices. In terms of price increases, Bukit Timah had the steepest rise at 38.1%, followed by Serangoon (10.8%) and Bishan (7.2%).

The number of million-dollar transactions has also increased, with 128 flats selling for at least $1 million in the past quarter, a 21.9% increase from the previous quarter. It is predicted that the number of million-dollar flats will exceed 400 this year, accounting for around 1.6% of total transactions.

In the coming months, HDB will launch up to 23,000 flats, with 6,000 of these set to be offered in December. This, combined with the Additional Buyer’s Stamp Duty, is likely to cause demand to be diverted from the resale market to the BTO market, potentially resulting in a dip in resale volume to between 26,000 and 27,000 units. Prices may also moderate to increase by 4% to 5.5% over the full year, lower than the 10.4% and 12.7% increases seen in previous years.